Maine requires all drivers to purchase uninsured/ underinsured motorist (UM/UIM) coverage, and it often comes into play in many car accident lawsuits. The minimum limits of UM/UIM coverage are $50,000 per person and $100,000 per accident. Typically, it’s a good idea if you can afford it to purchase more than that, as a serious auto accident can result in damages that far exceed that amount.

Uninsured and underinsured motorist coverage can apply if you are:

Injured in a crash caused by a driver with no car insurance;

Injured as a pedestrian bicyclist or skateboarder struck by a vehicle;

Injured in a hit-and-run accident or in a situation where a “phantom vehicle” enters your lane and causes you to veer off the road;

Injured as a passenger in a motor vehicle;

Injured in a crash caused by a driver whose bodily injury liability limits are lower than the limits of your UIM coverage.

In the recent case of Graf v. State Farm, the Maine Supreme Judicial Court was asked to weigh in on the details of a UIM claim between a driver and her insurance company following a 2005 car accident. The case had been through extensive arbitration, but there were a number of disputes the court was asked to resolve.

The parties don’t dispute that the crash that occurred in August 2005 was not the claimant’s fault. She was operating her personal vehicle when she was struck from behind by another motorist who was 100 percent responsible for the Maine car accident.

The at-fault driver had just $50,000 in coverage. Plaintiff had been on-the-job at the time of the wreck, so some of her medical expenses were covered (though it is not specified exactly how much).

One of the first issues that arose in this case was how many policies could be applied. Plaintiff argued that two were applicable – one in her husband’s name and another in her own. Both were provided by the same insurer, State Farm. The insurer, however, argued that just one policy was applicable. Her husband’s policy would have provided up to $1 million in coverage, including $100,000 in medical payments coverage. However, the vehicle plaintiff was driving wasn’t covered under that policy, which excluded coverage for crashes that didn’t involve a covered auto. The arbitrator – and later the court – agreed with the insurer on this fact, finding the policy language to be unambiguous and not against public policy. (The case was first arbitrated – rather than heard in court – under the terms of the policy.)

Plaintiff’s own UM/UIM policy provided for $300,000 in coverage, with $100,000 for medical expenses incurred within three years of the crash. The policy indicated it would deduct from that total medical payments already covered by workers’ compensation benefits or other insurance policies.

Plaintiff settled with the underinsured motorist for his policy limits of $50,000.

She then sought coverage under both UIM policies, but an arbitration panel restricted her to the $300,000/$100,000 policy. The arbitration panel then determined her damages were $378,000, with $125,000 of that for medical expenses. The panel then subtracted the $50,000 paid by the other motorist and reported her net damages to be $328,000. The insurer then filed a motion in the Superior Court asking for a reduction in the damage award. In a subsequent hearing, insurer presented evidence to show some of plaintiff’s medical bills were for services rendered more than three years after the crash and that some of those bills had been paid by workers’ compensation.

The court ruled she was entitled to a total of $250,000 because her policy allowed for a total of $300,000 in damages and she’d already received $50,000.

Upon review by the state high court, it was determined that the lower court erred because it never made a calculation of how much of her medical payments had been covered by workers’ compensation and which expenses were incurred outside that three-year time limit. The court did affirm, however, plaintiff was only entitled to collect from that single UIM policy, and not her husband’s – based on the “other-owned vehicle exclusion” of the policy.

This case shows what a big impact the specific terms of a UM/UIM policy can have on the amount a Bangor car accident victim can expect to receive. Read your policies carefully and make sure your policy will adequately cover you in a range of scenarios.

If you are the victim of a Bangor car accident, contact Peter Thompson & Associates at 1-800-490-5218 for a confidential consultation to discuss your rights.